Wagner James Au reports on virtual worlds, VR & Internet culture

Wednesday, December 04, 2013

Why Bitcoin Euphoria Reminds Me of Second Life Hype

"Bitcoin Euphoria Is Eerily Like Second Life Hype (and I Should Know)" is my new Internet Evolution essay pointing out the similarities between rising mainstream media euphoria over Bitcoin and the 2006-07 buzz over Second Life when it was being featured on the cover of BusinessWeek and beyond. (And as I suggest at the end, Second Life does have powerful, fun, and worthwhile applications, which is why I still write about it -- my comparison of SL with Bitcoin is to the "OMG it's the next generation of the Interwebs!!1!" rhetorical overreach from that period.) In the post, I point to enthusiasm over SL/Bitcoin despite little evidence of substantial user growth, and excitement over SL/Bitcoin's potential applications despite little actual usage. But to be sure, there's many other comparisons, among them:

Like Bitcoin, Linden Dollars were intended to be an Internet-wide currency. One widely-discussed plan was to make them the universal currency for am open 3D web (which would presumably grow out of Second Life's success), so L$ would be usable not only in SL but in all the OpenSim worlds across the web.

Like Bitcoin's code and culture around it, Second Life policies during the hype wave had a definite libertarian edge -- though Linden Lab had to quietly walk away from that philosophy, as I explain here.

Comments

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Its fascinating how the last 2008 poster in the "Libertarian" post you linked thinks there are two models: libertarian or socialist.

- That extreme view of the world explains one of the core problems I run into when dealing with self-proclaimed libertarians. Two-sides to everything, us vs them, etc. Never seeing the edge of the coin which is actually wider than either side...

Bitcoin's major corporate investor types all want it to lose the 'Libertarian edge' as well. They want it regulated. They want that so they can trace the money trails, gain predictability, gain accountability, and be sure they are not accidentally investing in criminal ventures that could expose them to sudden surprise liability.

There is a sane middle ground between 'laissez faire' and 'regulated into the ground' - and that middle ground is where BitCoin will have to land someday if it hopes to gain traction beyond the hype cycle. The flaw in Libertarianism in this regard is that because it sees only the sides of the coin, it presumes anything but laissez faire is over-regulation.

Every transaction with bitcoin can be seen unless a person uses a new wallet every time they buy something. A user's wallet and transactions are always fully visible. Do you even know anything about bitcoin? I'm guessing no.

Well, this explains the core problems and solutions should be created. Right now, it must be give and take to understand both sides and the underlying issue. That way, this can be solved to maximize its benefits.